ISM Non-Manufacturing October 2010 Index - 54.3%

The ISM Non-manufacturing report for October 2010 is out. The overall index increased to 54.3%, 1.1 points higher than September's 53.2%. Last month's services index increased 1.7 percentage points. The ISM indexes mean anything above 50 is growth, below 50 is contraction. Notice the jump is not as high as earlier in the year.

Below is the table from the ISM services report, edited. Business activity, or production boomed, up +5.6 to 58.4% from last month, yet employment hiring is limp still, with only a 0.7 point jump from last month. Last month business activity had dropped 1.6 percentage points. Again, we see businesses squeezing workers, the increased activity is just not paying off in terms of new hires.

ISM NON-MANUFACTURING SURVEY RESULTS AT A GLANCE OCTOBER 2010

Index

Series
Index
Oct.

Series
Index
Sept.

Percent
Point
Change

Direction

Rate
of
Change

Trend**
(Months)

NMI/PMI

54.3

53.2

+1.1

Growing

Faster

10

Business Activity/Production

58.4

52.8

+5.6

Growing

Faster

11

New Orders

56.7

54.9

+1.8

Growing

Faster

14

Employment

50.9

50.2

+0.7

Growing

Faster

2

Supplier Deliveries

51.0

55.0

-4.0

Slowing

Slower

7

Inventories

47.5

47.0

+0.5

Contracting

Slower

2

Prices

68.3

60.1

+8.2

Increasing

Faster

15

Backlog of Orders

52.0

48.0

+4.0

Growing

From Contracting

1

New Export Orders

55.5

58.0

-2.5

Growing

Slower

2

Imports

54.0

53.0

+1.0

Growing

Faster

3

Inventory Sentiment

61.5

59.5

+2.0

Too High

Faster

161

Below is the business activity index. Notice the jump.

New orders increased 1.8 percentage points to 56.7%. The report notes that new projects were approved which were on hold, that's good news.

While employment increased 0.7 percentage points, it's still anemic, barely registering any growth, at 50.9%. The below graph is re-centered around the ISM index inflection point to show we just are not creating jobs here and hiring people!

Prices paid by non-manufacturing organizations for purchased materials and services increased in October at a significantly faster rate than in September. ISM's Non-Manufacturing Prices Index for October registered 68.3 percent, 8.2 percentage points higher than the 60.1 percent reported in September.

To read more sub-indices and details see the actual report (although no eye candy from the ISM).

This report is about non-manufacturing. Here are the businesses included in the ISM index: